Justice becoming toy makers' go-to dollhouse

JohnKell

--Mattel debuted Monster High exclusively at Justice before broadening distribution

--Justice has far less influence in broader toy market than major retailers like Toys "R" Us

Life in plastic has been pretty fantastic for Barbie, but for toy makers looking to compete with the fashion icon, one retail chain is becoming the go-to destination for new dolls looking to make a splash in a competitive market.

Toy makers are turning to tween-focused Justice--a retailer that focuses on girls between the ages of 7 and 12--to launch their newest fashion dolls.

Over the past decade, Justice has partnered with a handful of doll makers as part of a broader strategy to add non-apparel items to its stores. The company primarily inks exclusive partnerships with outside brands, which also includes personal care, electronic and candy makers.

Justice was the initial home to one of the best-selling new doll lines in recent years, Monster High. Mattel Inc.
MAT, -1.82%
in 2010 exclusively launched Monster High at Justice stores, opting to focus on a store that sells products exclusively to girls rather than larger, more well-known toy retailers like Toys "R" Us Inc. or Wal-Mart Stores Inc.
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Cathy Cline, a Mattel marketing executive, said the toy maker selected Justice as the home for the Monster High launch because the chain is "one of the most influential tween retailers." Ms. Cline said the launch was the deepest partnership between the companies.

The strategy worked. Monster High has been regarded as a hit, and is now a $1 billion brand at retail.

Justice still sells Monster High dolls, which are now sold more broadly, and also Novi Stars, a brand launched by MGA Entertainment Inc. last year. Though the Novi Stars launch wasn't exclusive, Justice sold some related apparel.

In past years, Justice has sold Mattel's My Scene fashion dolls and toy stuffed animal line Webkinz, both outside the core apparel and accessories offerings.

At first glance, Justice--which operates about 1,000 stores in the U.S. and generated $1.3 billion in total sales in the latest fiscal year--seems like an unusual destination for doll launches. The company, which is part of Ascena Retail Group Inc.
ASNA, -1.62%
along with Lane Bryant and dressbarn, is mostly known for selling its own apparel, shoes, sunglasses and other accessories.

Justice's toy sales are also dwarfed by Wal-Mart, Toys "R" Us and Target Corp.
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stores where many toy makers derive a majority of their annual sales.

But observers say Justice's core audience is ideal to build a fan base for new dolls. Scott Bracale, president of marketing at Ascena's Tween Brands division, said about 10 million girls are active customers at its stores. Mr. Bracale said Justice also showcases brand partners in the 13 catalogs the company mails throughout the year to millions of girls.

Launching a new doll line is difficult as the market is currently dominated by four names: Mattel's Barbie and Monster High and MGA's Bratz and Lalaloopsy.

Laurie Schacht, co-publisher of industry publication The Toy Insider, said Justice is an ideal retailer for doll makers focused on the tween audience, though the strategy wouldn't work for a preschool brand. This year, Ms. Schacht estimates 10 new fashion dolls will hit U.S. shelves.

The market is getting crowded as recent sales data shows dolls are among the more successful categories in the toy industry. Though NPD Group last month reported toy sales dropped 0.6% domestically in 2012, doll sales were up nearly 6%.

Few of those new dolls will find a home on Justice's shelves. Mr. Bracale said while his company is still on the hunt for the next doll hit, they turn away a vast majority of partnership offers. Outside products command thinner margins than Justice-owned gear, so Mr. Bracale said executives need to be wowed before bringing any new dolls into Justice's stores.

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